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Rental vacancies rise - time to buy?

18 Jul 14

A growing number of people might be seeking real estate advice and going in search of their own property, as it emerges that rental vacancies have increased throughout the country.

June data from SQM Research shows a national vacancy rate of 2.3 per cent, making it the highest result since December last year.

Adelaide wasn't immune to this trend either, as its vacancy rate registered at 1.6 per cent during the month. This marks no change since the previous month and is down from the 1.7 per cent recorded in June 2013.

A total of 2,645 rental properties were on the market last month, which compares to 2,785 in June 2013.

The only anomaly was Hobart, which witnessed a fall in its rental vacancy rate from 2.6 per cent in June last year to 1.6 per cent in June 2014.

SQM Research believes this is indicative of a wider trend, suggesting there is a definite slowdown throughout Australia's rental market.

Managing Director Louis Christopher commented: "At this stage the market is increasingly favouring tenants across the country. While this is not yet a rout for landlords, it certainly is at a stage where rents will unlikely rise above inflation for the next 12 months.

"This means that rental yields will continue to fall, thereby reducing the net cash flows for new property investors in the market place."

The group also released details of its Asking Rents Index, which showed stagnation in prices across state and territory capitals.

No month-on-month change was seen in the value of houses, while there was a 0.7 per cent fell in asking rents for units.

Asking rents for all houses in Adelaide have increased 2.4 per cent over the past three years and are up 1.2 per cent for units. Three-bedroom houses experienced the biggest rise of 4.9 per cent.